The Tenuous Relationship between the Fight against Money Laundering and the Disruption of Criminal Finance.
This article examines the fight against money laundering as a case study of the separation between an enforcement system's objectives and performance. To launder money is to hide its illegal origin. The fight against money laundering is supposed to disrupt laundering in its various forms—especially...
| Published in: | Journal of Criminal Law & Criminology Vol. 93; no. 2/3; pp. 311 - 466 |
|---|---|
| Main Author: | |
| Format: | Article |
| Published: |
Northwestern University
Winter/Spring2003
|
| Subjects: | |
| Online Access: | View this record in EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=502510209&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 502510209 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00914169 CLC jtl: Journal of Criminal Law & Criminology issn: 00914169 maglogo: N pubinfo: dt: Winter/Spring2003 vid: 93 iid: 2/3 pid: 1093 pub: Northwestern University artinfo: ui: 502510209 ppf: 311 ppct: 155 formats: fmt: – @attributes: type: T – @attributes: type: P size: 20.3MB tig: atl: The Tenuous Relationship between the Fight against Money Laundering and the Disruption of Criminal Finance. aug: au: Cuéllar, Mariano-Florentino su: Money laundering Criminal law Law enforcement Organized crime United States sug: subj: United States Money laundering Criminal law Law enforcement Organized crime ab: This article examines the fight against money laundering as a case study of the separation between an enforcement system's objectives and performance. To launder money is to hide its illegal origin. The fight against money laundering is supposed to disrupt laundering in its various forms—especially what is done by third party launderers and leaders of criminal organizations. In the process, the fight is supposed to undermine the process of financing and profiting from crimes ranging from drug trafficking to terrorism. Yet this fight delivers less than what it promises. Like many other enforcement systems, the fight against money laundering involves three major components: statutes with criminal penalties charged by prosecutors, rules administered by regulators, and detection systems primarily run by investigators. A close analysis of its three components reveals the fight to have quite a limited scope, involving (1) the disproportionate imposition of severe penalties on predicate offenders who are easily detected; (2) lax and narrowly-focused regulatory authority; (3) limited capacity to detect a range of chargeable domestic and international offenses; and (4) global diffusion of a fight against money laundering that leaves implementing authorities plenty of room for discretion and lax enforcement. These limitations probably arise not because of blindness or bad intentions but because the major players involved in running the system—including legislators, prosecutors, investigators, and regulators—face a tangle of incentives that leads them to dilute the intensity and scope of enforcement against some targets and to enhance the sanctions faced by other targets. While there is some evidence that suspicious activity reporting probably helps identify drug money placement in banks, the system seems ill suited to detecting and disrupting the larger universe of criminal financial activity that is so often vilified by the rhetoric justifying the fight against money laundering. All of this makes it hard to target terrorist financing using the anti-laundering system, even though it is easy to freeze assets allegedly linked to terrorism. Some changes in the system such as enhancing audit trails and strengthening suspicious activity reporting and analysis could be defended in the name of making the system work, though politics would make them difficult to achieve and their ultimate consequences are hard to predict. In the meantime, any inequities in the detection of predicate crimes end up being reproduced in money laundering prosecutions, and the system's most compelling objectives—detecting crimes in a new way, and targeting third-party launderers and leaders of criminal networks—seem mostly beside the point. Reprinted by permission of the publisher. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
|---|